LONDON: British government bonds rose on Tuesday in line with their German peers, as investors ducked into safe havens after international lenders delayed the next tranche of Greek aid.
Greece's international lenders agreed on Monday to give the country two more years to make the cuts demanded of it, but the euro zone and the IMF clashed over a longer-term target date to shrink the country's debt pile.
At 0853 GMT, the December gilt future was 19 ticks higher at 120.76, in step with the equivalent Bund.
"While we think in the end a solution will be put forward for Greece, the coming weeks are still vulnerable to negative headline risks," said Barclays fixed-income strategist Cagdas Aksu.
Gilt investors are awaiting British October inflation figures, due out at 0930 GMT.
"The main focus today will be UK CPI numbers. The market is broadly expecting inflationary pressures to rise after headline CPI fell to the lowest rate in nearly three years at 2.2 percent in September," said Lloyds strategists.
Attention is also focused on the Bank of England's Inflation Report on Wednesday for clues on whether the central bank may decide on more bond-buying in the months to come.
Markets digested data released overnight which saw British house prices fall at their slowest pace in more than two years in October, as demand from prospective buyers increased, adding to hope the economy may be improving.
Ten-year gilt yields fell nearly 2 basis points to 1.70 percent, with their spread versus Bund yields a touch wider at 37.5 points.
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